Thread: Short Sales

Of course. I don't see why not...FSBO or not, you talk to the bank and negociate. That's it...

Thanks for that information. I am going to get in touch with the bank and I will post the information.

A short sale will only work if the owner is in default. If they are, they shouldn't be going FSBO. They should be using a qualified Realtor.

What exactly is a short sale? Just trying to learn about real estate so I have lots of questions.

Short sale (real estate) - the lender allows a property to be sold for less than the amount owed on a mortgage and takes a loss.

In regards to using a qualified Realtor when doing a short sale instead of negotiating a FSBO I think your right. I found out recently that sellers of FSBO's are using Short sale negotiator's for a cheaper fee than the commission's realtors earn from the banks on a short sale transaction. Leaving the banks more than happy to agree on the sale do to less fees paid to close. I don't know enough to comment on this issue. Does anyone have more information about this?

Thanks for explaining what a short sale is. Anxious to learn more about real estate.

I agree with JasonShepard, why would a buyer who is in default want to deal with another problem, when they can have a highly qualified Realtor handle the transaction, negotiate with the bank, find a buyer, close the deal and allow the owner to start new.

Sellers in financial trouble are clueless how a Short Sale works. When I take a Short Sale listing, I'm in and out in 15 minutes. I tell the owner to "Sign HERE"! My listings are at 8%-10% commission and price is 10%-15% below the lowest price of a similiar property. I get contracts in 3 days and the deal is done in 4-8 weeks!

The seller should NOT care about how much commission is in the deal now that the Feds say you do not have to pay tax on the deficiency.

FORGET FSBO Short Sale. How are you going to advertise it? With what money?

Let professionals do their job, since it does not cost you anything anyway.

Originally Posted by REbuyersgroup

The seller should NOT care about how much commission is in the deal now that the Feds say you do not have to pay tax on the deficiency.

FORGET FSBO Short Sale. How are you going to advertise it? With what money?

Let professionals do their job, since it does not cost you anything anyway.

there are restrictions on the don't have to pay tax thing, correct? my research found this example:

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Of greater relevance is the fact that, to be excluded, the debt discharged must be acquisition debt. That is, the mortgage must have been used to purchase the home. Suppose, for example, that you have lived in your home for twenty years, that you bought it back when it was "only" $200,000, and that, by now, you have refinanced it up to $650,000. Suppose, also, that your neighbor purchased his home just last year, and that he took out a $650,000 mortgage to finance the transaction. Now, both of you need to sell and your homes have decreased in value to $600,000. If you both are granted short sales by the lender, you will both have mortgage debt forgiveness of $50,000. Under H.R. 3648, his debt forgiveness will not be taxed because it was acquisition debt. Yours, however, will be. Bummer.
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so it only seems to help those that happened to get a near 100% LTV loan right at the peak of the market, not those that refinanced and/or got 2nds, then got in trouble.

is my information wrong?

and how is your 8-10% commission determined, it seems if the home owner will wind up with a tax burden after all, that that your commission will directly affect the amount of this burden...

so perhaps in some cases the owner SHOULD care...